Economic Life

The economic opportunities open to Jews of Eastern Europe over their history were limited by non-Jewish society—largely through legislation. Thus, in order to understand Jewish economic life, it is important to have a clear picture of the laws and regulations imposed by non-Jewish society. These were never monolithic and were often extremely complex. Consequently, economic success for Jews was often a result of the ability to maneuver between different—and sometimes contradictory—regulations in order to achieve their goals.

The basic, and most influential, legal prescription concerning Jews in Eastern Europe (and throughout the whole continent) banned them from owning land. This policy remained in force from the Middle Ages until sporadic legislation—beginning in the late eighteenth century and culminating in the twentieth—permitted Jews to own land. This ban prevented Jews from making their living from agricultural activity whether as peasants or as landowners, two of the most important positions in the feudal social structure.

Broadside with cartoon showing a Jew, an Armenian, and people indicated by occupation mourning the death of Credit, Poland, seventeenth century. (Biblioteka Naukowa Polskiej Akademii Umiejętności i Polskiej Akademii Nauk w Krakowie)

As a result, Jews concentrated in towns, often forming a second urban class parallel to that of the non-Jewish burghers. This led to competition between them, which found expression in the medieval urban legal system—Magdeburg Law—that excluded Jews from the urban merchant and craft guild monopolies. The hostility that accompanied competition between townspeople and Jews persisted throughout the history of East European Jewry, finding expression in both legislation and physical violence in every period. By contrast, rulers such as Premysl Otakar II of Bohemia and Bołeslaw the Pious of Kalisz gave Jews settlement privileges in return for services in the field of credit. In the early modern period, the nobility, which was hostile to urban monopolies, worked to weaken such monopolies by supporting their Jewish competitors. This led to the granting of special community privileges, especially in private towns owned by powerful aristocrats in Hungary and Poland.

Until their emancipation, Jews enjoyed a legal status as a corporate group. However, this group status was never clearly defined; sometimes it resembled that of a foreign ethnic group (comparable to other trading communities in the region, such as Armenians or Scots), which tended to limit their economic activity, and sometimes that of a second urban estate—which allowed them deeply to penetrate urban markets during the eighteenth century.

From the mid-eighteenth century, the slow development of Enlightenment ideas in Eastern Europe contributed importantly to a change in the structure of society from a conglomeration of groups, each with a different role and a different legal status, to a group of individuals with equal rights and responsibilities toward the state. The economic component of this ideology—physiocracy—that valued the natural economy and agricultural work above all, viewed Jewish economic activity negatively. It argued that in order to make Jews useful members of society, their economic life should be reformed to make it more “productive.” In real terms, this meant causing Jews to abandon petty trade in favor of agriculture, or at least crafts and industrial labor. As a result, starting with Joseph II’s Edicts of Toleration in the 1780s, the nineteenth and twentieth centuries saw a series of legislative attempts to “productivize” Jewish economic life so that Jews would be better integrated into the economy. These attempts were largely unsuccessful until the Soviet Union in the 1920s and 1930s adopted an aggressive policy along these lines.

Legal discrimination, aimed at weakening Jews’ economic status, continued throughout the nineteenth and twentieth centuries. In the tsarist empire, it followed a zigzag course, alternating with reformist policies during the nineteenth century. In the post-1918 nation states, economic policy shifted from trying to reform Jews’ economic activity to excluding them as far as possible from the national economy, while encouraging members of the dominant nationality to take their place. Obviously, these states did not adopt this policy in concert, although it was common to most of them and tended to intensify with the passage of time.

The most direct form of legal discrimination with which Jewish society had to deal was the exclusion of Jews from various economic fields. This was the policy of guilds and professional associations, which claimed a monopoly on a particular sector of the urban economy, refusing Jews membership and barring them from participating. Another means of excluding Jews from a certain profession was to establish a system of licenses with conditions that Jews would find difficult to fill: these could include educational certificates, full literacy in local languages, or even possession of a large capital sum. Even after emancipation, an unstated but widely applied policy was to keep out or at least severely restrict access to civil service. The adoption of the numerus clausus—most famously in the universities but also in company directorships in 1930s Hungary—was a less extreme form of the same measure. Much less effective were Sabbath Rest laws, as well as attempts to organize boycotts of Jewish businesses: since Jews held many key positions in the urban markets—particularly in outlying areas—this kind of boycott hurt the boycotter almost as much as the boycotted.

Finally, the legal establishment of Jewish quarters in premodern towns, as well as irksome zoning regulations in the modern period, was meant both to separate the Jewish and non-Jewish populations and to weaken the Jews’ economic position. Such seems also to have been the case, at least to a certain extent, with the establishment of the Russian Pale of Settlement from the end of the eighteenth century. Only the Nazis introduced the most extreme form of this policy, namely the establishment of closed ghettos, into the region in the 1940s.

Legal prescriptions were only one of the factors that determined the structure of Jewish economic life in Eastern Europe. Hardly less important were cultural attitudes and norms, including widespread numeracy and literacy, within Jewish society. These also substantially influenced Jews’ choices of ways and means of making a living. Contemporaries paid attention to the cultural factors that contributed to Jews’ ability to overcome the competition and hostility of their neighbors. Among them were frequently counted frugality, a willingness to reinvest income in business, and ethnic and religious solidarity. To these should be added the Jews’ historical familiarity with the monetary economy and the market, their numerical strength in the towns and cities, and their ability to carve out for themselves strong economic niches.

Jewish society understood economic success as fundamental for its survival and prosperity. It was therefore sensitive to the economic needs of the societies in which it lived and developed a relatively high degree of economic flexibility in order to take best advantage of the changing situations in which it found itself. The willingness to embrace new economic opportunities was thus one of the basic characteristics of Jewish economic activity in Eastern Europe.

Another basic characteristic of Jewish economic activity in Eastern Europe throughout most of its history was the active participation of women. For the most part, women’s economic life formed part of a family business, with a wife active alongside her husband. In many cases, the woman worked in the home or in a store, while her husband was away on business. However, as early as the seventeenth century, there are records of women being active in the marketplace. The religious authorities were uneasy about this phenomenon insofar as it brought women into compromising social situations. In the nineteenth century, the East European Jewish bourgeoisie viewed women’s work as unnatural, instead developing the image of the housewife as the feminine ideal. At the same time, elite sectors of Orthodox Jewish circles emphasized the importance of women’s economic activity as a means of freeing men for religious study. On the whole, however, it was pure economic necessity that led women to work in order to put food on the family table. [SeeGender.]

Although some scholars have posited a Jewish cultural (or even racial) predilection for trade and finance—particularly of an antimonopolistic or capitalist nature—the historical record does not bear this out. For many centuries Jewish economic activity formed an integral part of the feudal economy, with Jews breaking only those monopolies that excluded them.

Jews on a market day in Warsaw, 1880. Stereograph by Keystone View Company. (Tomasz Wisniewski, www.szukamypolski.com)

Research on the relationship between the prescriptions of Jewish law and custom and Jewish economic activity in Eastern Europe has shown that rather than defining economic activity, the halakhah has tended to be shaped by the economic needs of Jewish society. In the nineteenth century, Hasidism and Orthodoxy were accused of encouraging a kind of economic fatalism through their blind trust in God’s bounty. This was supposed to have led to inactivity and poverty among their followers. In truth, however, many of Eastern Europe’s wealthy Jews supported, or even joined, these religious movements, whose very existence depended on income from their adherents.

The Haskalah had a sharp critique of the structure of Jewish economic life. Influenced by physiocratic ideas, maskilim preached the “productivization” of Jewish society—and especially encouraged moving Jews from petty trade to agriculture. Societies were set up in many communities to train young Jews in agriculture and crafts. In the latter part of the nineteenth century, Jewish nationalists and socialists took up productivization. Many Zionists, for example, continued to support the idea that agricultural labor would help Jews throw off the stigma of Diaspora life; socialist groups, such as the Bund, extolled the virtues of the productive proletariat against the bourgeoisie who engaged in trade.

More influential than ideology was the strong urbanization trend of the nineteenth and twentieth centuries. Not only did the loosening of social and cultural bonds caused by the move to the great conurbations lead to secularization, but it also exposed the Jewish masses to the effects of those phenomena connected with the rise of capitalism: the growth of the industrial proletariat and the burgeoning of the mass market. In addition, the economic, social, and cultural gap between Jews of the city and Jews of the small town (shtetl) grew ever greater. Increasing poverty in the economic backwaters, most notably in much of the Pale of Settlement at the turn of the twentieth century, led large numbers of Jews to migrate westward in search of a better living—particularly to the United States.

Another result of the spread of secularization in the region during the late nineteenth and twentieth centuries was that the proportion of Jews among university students rose dramatically, and was frequently higher than their proportion in the general population. It took severe discrimination—and particularly a strict numerus clausus in the universities—to bring the numbers down. High levels of university education meant that Jews could often benefit from the advantages of upward social mobility and join the middle class as white-collar workers.

These legal and cultural factors laid down the framework for the Jews’ economic life in Eastern Europe. Over the centuries, Jews played particularly important roles in the three major economic sectors of finance, production, and distribution. These will be surveyed below, followed by a short discussion of Jews’ economic activity in other fields. Since the Holocaust formed a major break in this history, the economic life of the East European Jews during and after it will be discussed in a separate, concluding section.

Banking and Finance

In the Middle Ages, the monetary economy was relatively new in Eastern Europe, so Jews, as immigrants from better-developed regions in Central Europe, were able to take advantage of their long experience in the realms of exchange and moneylending. Initially, Jews helped Polish monarchs produce specie by leasing the royal mint. In the reigns of Mieszko III (1138–1202) and the kings of Hungary in the thirteenth century—in particular Béla IV (1235–1270)—Jewish entrepreneurs minted coins on which they sometimes stamped Hebrew inscriptions.

From at least the mid-thirteenth century, Jews were active in moneylending, playing a role in both the urban and the regional economies, lending to nobles, burghers, and even peasants. Royal legislation affecting Jews attempted to regulate their credit activities, in particular by forcing them to register loans in the Castle Records. This policy was meant to protect Jewish creditors at least as much as their non-Jewish debtors. In fact, the kings themselves often made use of Jewish bankers. Figures such as Lewko from Kraków in the fourteenth century and Josko of Hrubieszów in the fifteenth were extremely influential as court bankers and financiers. The Mendel family of Buda and Shelomoh Senior from Spain—later baptized as Imre Szerencsés (Fortunatus)—played a similar role in Hungary during the late fifteenth and early sixteenth centuries. The Fiszel family of Kraków, particularly Mosheh, and his widow Raḥel after his death, were frequent visitors to the courts of Casimir IV the Jagiellonian and his successors. Though Jews were by no means the only moneylenders in Poland (and often did not even make up the majority of those making their living this way in any given locale), their activities were singled out for opprobrium particularly by the church, which, for theological reasons, was interested in regulating the credit market.

In the sixteenth century, moneylending became less attractive because legislation had made it increasingly difficult for Jewish creditors to foreclose on real estate and because high levels of inflation rendered the business increasingly unprofitable. This, combined with their improving legal situation in the towns, led large numbers of Jews to take up trade. In another development, instead of mortgaging their estates to Jewish moneylenders, nobles began leasing them out instead. The move to such leases (Pol., dzierżawy) allowed noblemen to realize capital sums on their estates without the risk of losing them in case of default (a development that also saved Jews some embarrassment, since they could not take possession of the estate). It also allowed Jewish creditors a return on their investment not in the form of cash, which was losing its value, but as agricultural produce, whose value remained high. These leases became extremely popular in a relatively short time and remained so, both with nobles and Jews, in Poland, as well as later in Hungary, well into the nineteenth century.

Gentiles dancing and drinking in a Jewish tavern. Lithograph by G. Pillati published by A. Chlebowski, “Swit,” and printed by B.Wierzbicki and Sons, Warsaw, n.d. (Moldovan Family Collection)

Jewish moneylending did not die out entirely; some Jews continued to make their living lending money (mostly pawnbroking) to their non-Jewish neighbors. In addition, loans between Jews became increasingly important as a form of mercantile credit. Though Jewish law formally forbade lending between Jews at interest, a panel of early seventeenth-century rabbis, in response to economic necessity, devised a formula to permit it. Jews also developed a new form of bearer bond (Pol., mamran) to aid the transfer of funds from creditor to debtor.

Various members of the wealthy Jewish bourgeoisie, such as Jakub Bogaty in Kraków and the Nachmanowicz family in Lwów, gave extensive mercantile credit of this kind, establishing themselves effectively as private banking houses. The importance of Jewish bankers for the Polish royal court declined in the sixteenth to eighteenth centuries, though some figures such as Jakub Becal in the seventeenth century and the German court Jew Behrend Lehmann (1661–1730), in the eighteenth did fulfill this role. In Habsburg lands, the activities of Samuel Oppenheimer (1630–1703), and even more so Samson Wertheimer (1658–1724), marked the apogee of the influence of court Jew bankers.

Jewish communities and regional councils played an unusual role in Poland’s credit market in the seventeenth and eighteenth centuries. Rather than lending money, they took loans from nobles, and particularly from church institutions. These were standing loans at a low, fixed rate of simple interest. Called widerkaffy, they were often used by communities to finance large capital projects such as building synagogues. The motivation for non-Jewish individuals and institutions to lend money to Jewish bodies is unclear, though some scholars have argued that the communities and councils were acting as investment banks, giving steady interest on capital that could not easily be invested elsewhere. Over the years, the size of the loans taken by the communities grew alarmingly until the abolition of the Jewish Council of Four Lands in 1764 destroyed confidence in Jews’ ability to continue to finance the loans. The ensuing debt crisis lasted for more than 30 years and had deleterious effects on Jewish communal life.

Unfortunately, though Jewish credit was undoubtedly important in financing Poland–Lithuania’s agricultural and mercantile sectors in the early modern period, there are no figures to indicate the extent of the role Jewish financiers played in the national economy. At the turn of the nineteenth century, the exigencies of state finance led individual financiers to institutionalize their activities in the framework of private banks. In these years, Jewish bankers throughout Europe played a significant role in the development of the East European economy. Initially, it was the large Jewish banks of Central and Western Europe (such as those of the Rothschilds) that played this role, while indigenous Jewish banking in the Pale of Settlement was limited to smaller institutions in regional centers. However, even before the 1850s, major Jewish private banking institutions had developed in Congress Poland (the Epstein, Bergson, and Kronenberg banks) and Hungary (the houses of Arnstein and Eskeles).

As the pace of modernization in Eastern Europe picked up in the second half of the century, Jews’ roles in the financial world grew significantly. The banks run by the Gintsburg and Poliakov families became significant in the Russian economy, with branches in most major urban centers. A similar growth in importance was felt in the role played by Jews in the banking sectors of Poland (the banks of Hipolit Wawelberg and Jan Bloch) and Hungary (Zsigmond Kornfeld and Nandor de Madarassy). In this period too, institutions run by Jews were also in the forefront of some of the important developments in the sector: in Congress Poland, Jewish bankers were instrumental is establishing joint stock banks. Many were also active in the rapidly developing stock exchanges of Eastern Europe.

These Jewish financiers did not limit their activities solely to the banking sector, however, but also acted as industrial entrepreneurs. In the second half of the nineteenth century, Jewish entrepreneurs such as Izrail’ (Yisra’el) Brodskii and Evzel’ Gintsburg from Russia became prominent in, among other things, sugar and alcohol manufacturing, developing expertise that permitted them to restructure not only the means of production, but also the means of financing and marketing their product. In addition, Jewish bankers, such as Herman Epstein and Leopold Kronenberg from Poland and the Poliakov brothers from Russia were prominent in the introduction of the railways to Eastern Europe, for example, in the construction and management of, among others, the Vienna–Warsaw and Kharkov–Taganrog lines. In Hungary, the Vienna branch of the Rothschild bank supported railway development. To a very great extent it was the ability of these Jewish business magnates to combine their entrepreneurial skills with their experience in banking that allowed them to make such a significant contribution to the modernization of the economies in which they worked. In social terms, it should be noted that, perhaps due to their close ties with the non-Jewish financial world, a great many of them chose to convert to Christianity.

In 1897, Jews owned nearly 60 percent of Warsaw’s major private banks. Elsewhere in Congress Poland, this figure rose to more than 90 percent. Jews were also extremely prominent in Hungarian banking. In Romania, on the other hand, the Jews’ poor legal situation meant that the richest Jews continued to act as moneylenders rather than bankers throughout the nineteenth century. In the Czech lands, Jews had a limited role in banking, squeezed out by ethnic Czech and German institutions.

As the nineteenth century progressed, joint-stock banks gradually superseded the private banks, with prominent Jewish bankers finding their place among their directors. With the exception of Hungary, where Jews continued to play an important role in the banking world, the new nation states set up after World War I did not offer an encouraging environment for Jewish bankers, whose numbers—and importance—declined sharply.

Inside Jewish society, the late nineteenth century saw the establishment of savings and loan funds with the aim of combating growing levels of poverty by providing poor Jews with a certain degree of credit and a small source of investment capital. In 1896, the Russian government first officially sanctioned the establishment of a popular Jewish loan society, which led to the rapid spread of such institutions. By the outbreak of World War I, as much as half of Russian Jewry—mostly craftsmen and petty tradesmen—may have benefited from the activity of the savings and loan funds. Reestablished in Romania and Poland during the 1920s, these organizations began to fail in the 1930s during the worldwide Depression.

Production

When, particularly in the nineteenth century, Jews were persuaded by state incentives to try their hand at farming for a living, they could draw on no collective experience to help them. This was one of the major factors leading to the failure of most attempts to transfer Jews from urban occupations to agriculture in the modern period.

Despite this, Jews were not complete strangers to agricultural activity. Since from the mid-seventeenth century much of the Jewish population lived in small, agricultural towns, while others leased village inns and taverns, many Jews kept vegetable gardens and even a certain amount of livestock. Though most did not make their living in this way, agriculture provided a useful secondary income. Popular was horticulture, dairy farming, and even apiculture, with the honey sold for profit. Tavernkeepers would often cultivate the grain they needed for the production of beer and vodka. Exceptionally, Jews could own vineyards, as they did in the Tokaj region in northern Hungary already in the second half of the eighteenth century. In the early modern period, feudal estate owners were sometimes known to grant these leaseholders fields and corvée labor from the peasant population to help with the cultivation. However, since Christian peasants objected to doing feudal services for Jews, this arrangement was soon abandoned.

The Jews’ importance for the East European agricultural economy was not as farmers but in the fields of administration and marketing. Jews who leased entire estates from the nobility (dzierżawcy) achieved the de facto status of estate owners, responsible for management on a day-to-day basis. This role developed first in the sixteenth and seventeenth centuries, declined in the eighteenth, and turned in nineteenth-century Galicia and Hungary into a form of land-tenancy, in which Jews would lease rural estates to sublet to Jewish and non-Jewish tenants for cultivation.

Jewish arendarzy played a crucial role in marketing when they leased the feudal monopoly on the production of alcoholic beverages (propinacja) and sold the estate’s agricultural produce to peasants in the form of alcoholic beverages. In the eighteenth century, returns from the lease of propinacja rights could make up as much as 25 percent of the income from an estate. The social problems of overdrinking that this phenomenon caused in the villages were largely blamed on Jews. Starting in the late eighteenth century, Russian and Austrian authorities attempted to close this occupation to Jews, often in brutal fashion. During the course of the nineteenth century Jews began to move from rural to urban regions, leading to the decline of Jewish tavernkeeping, an occupation for them that largely disappeared after World War I.

Following World War I, the new nation-states of East Central Europe abandoned the policy of encouraging Jews to adopt agriculture. Nevertheless, it should be noted that in eastern Galicia and the Subcarpathian Rus’ region of Czechoslovakia a significant proportion of Jews made their livelihood by tilling the land and cutting timber. The Soviet Union, however, continued to encourage Jews to become farmers (“productive” laborers) in new agricultural colonies in northern Crimea and southern Ukraine, as well as Uzbekistan, Georgia, Azerbaijan, and Dagestan. The new Jewish Autonomous Province of Birobidzhan was also planned to have a significant Jewish population of agricultural laborers. With the help of foreign philanthropic organizations, some 200,000 Soviet Jews became farmers in all of these settlements. The failure of Stalin’s agricultural policy and the ravages of the Holocaust put an end to these experiments.

In the new nation-states of East Central Europe, the most important group to emphasize the importance of agriculture for Jews was the Zionist movement, which continued to believe in the values of productivization preached by maskilim. Zionists established a series of training farms throughout the region to prepare young pioneers for a life of farming in the Land of Israel. They had only limited success.

Much more significant in Jewish society was productive labor in the field of crafts. Jews were active craft workers from medieval times until the mid-twentieth century. For most of this period, the dominant social frameworks in which craftsmen functioned—the guilds—were Christian monopolies that were closed to Jews. Initially, the latter tended to concentrate in those fields in which their religious requirements forced them to work: slaughter and butchery, bakery, and textile-related crafts. With the rapid growth of the Jewish population in early modern Poland–Lithuania, more Jews turned to crafts to make a living. It was a sign of their importance in urban life that the guilds were largely unable to prevent them doing so, though work done by such unaffiliated craftsmen, known as partacze, was viewed as inferior.

Crafts in which Jews were prominent (apart from the above-mentioned) included leather tanning, furriery, millinery, and gold- and silversmithing. During the eighteenth century, the number of Jewish craftsmen grew rapidly, often leading to new forms of social organization: in some cases, particularly in small towns in which the Jewish population was prominent, Jews were allowed to join local guilds either as individuals or as part of special Jewish sections. In others, among them the large towns of Kraków or Prague, Jews established their own guilds. As the range of Jewish craft activity grew to embrace, among other things, metalwork, carpentry, and soap and candle manufacture, there were signs that craftsmen attempted to avoid unnecessary competition with their neighbors. This led in some cases to a form of “division of labor,” with Jewish craft workers responsible for some professions in town and Christians for others. This arrangement, however, only barely masked the underlying competition and hostility between Jewish and non-Jewish craftsmen.

Physiocratic theory of the late eighteenth century viewed productive handwork as positive, with legislation such as Joseph II’s Edicts of Toleration encouraging Jews to take up crafts, though no legislation could mitigate guild hostility. In order to have an edge over their non-Jewish competitors, Jewish workers were much more active in the field of marketing, devoting time to visiting their clients and selling goods to them in their houses. Other innovations included producing finished clothing for sale to retailers and developing piecework transactions by providing artisans with raw materials and paying them for labor on receipt of the finished product. This contributed to the increase of their numbers: in Galicia as well as tsarist Russia during the nineteenth century, Jews made up a considerable proportion of all craftsmen—in the Pale of Settlement they formed half of the total work force in this sector. By the end of the century, nearly a third of Jews in Russia made their living from crafts. In Moldavia, too, the proportion does not seem to have been significantly less, with Jews branching out into a range of new professions, including building and construction.

Most Jewish craftsmen worked in small workshops or family businesses, which employed only few artisans. The spread of industrialization in nineteenth-century Eastern Europe paradoxically had an adverse effect on those Jews making their living in this field. Large factories tended to squeeze out the small Jewish-run workshops, while only limited numbers of Jews were taken on to work in the large modern factories. This factor is usually attributed to the unwillingness of owners—Jewish and non-Jewish—to employ Jewish labor: the only large industries with a mainly Jewish workforce were tobacco and match manufacturing, though there was a large center of Jewish textile manufacturing in Białystok. Jews were less desirable employees because they did not work on Saturdays and also tended to organize into unions to demand improved working conditions. This development began in 1892 with Jewish workers seeking to standardize hours and wages, and occasionally even coordinating strikes; the foundation of the Bund in 1897 strengthened this process.

The economic policies of the Soviet Union made the position of independent craftsmen increasingly untenable. The decrease in numbers of Jewish craftsmen happened slowly during the 1920s, with Jews continuing to form a significant proportion in Belorussia and Ukraine—particularly in the tailoring, leather, printing, and food sectors. On the other hand, following nationalization, the numbers of Jews who worked in metal- and coal mining increased. By 1939, craftsmen made up about 20 percent of the Soviet Union’s Jewish workforce; in the non-Jewish population this proportion stood at less than 5 percent.

In the interwar period, Poland’s poor economic situation led many Jews to join professional trade unions, with the Bund playing an influential role in the Central Council of Jewish Trade Unions (Tsentralrot fun di Profesionele Klasn-Fareynen). In 1938, Jewish trade unions reported about 98,000 members, half of whom had joined unions affiliated with the Bund. Jewish trade unionism was the most comprehensive in Poland.

Students and teachers in a dressmaking course sponsored by ORT, Iaşi, Romania, ca. 1939. The Yiddish inscription on the blackboard reads, “Work is nothing to be ashamed of.” (YIVO)

In this period, skilled labor was the second most important source of income (after commerce) for Polish Jewry—a situation not significantly different in the other states of East Central Europe. Approximately half a million Polish Jews were registered as being employed in “industry.” Half of these were self-employed and worked in the garment and food sectors; their proportion in the general workforce was considerably greater in economically backward regions than in the more developed ones. In the early 1920s, Polish Jews formed the overwhelming majority of all the country’s tailors, watchmakers, and hatters. Jews’ participation in the leather trade remained considerable: in 1931, Jews made up 45 percent of all leather workers.

Discriminatory legislation was passed in Poland in 1927, introducing a system of licensing for craftsmen that Jews found increasingly hard to obtain; many were forced to work illegally. Anti-Jewish policies also hit Jewish participation in the textile industry. Jewish-owned textile factories tended to downscale, employing Jews in clerical posts rather than as workers. In Lithuania, legislation making it mandatory for artisans to be proficient in the Lithuanian language similarly curbed the number of Jewish artisans, who had traditionally worked in the food, textile, and leather industries.

In interwar Hungary nearly 35 percent of the Jews were classified as making their living from industry, and in Czechoslovakia a smaller proportion of the Jewish population (about 20%) worked in industry and crafts. In the Czechoslovakian regions of Bohemia and Moravia, industry was prominent—particularly textiles and oil refining—while in Slovakia and Subcarpathian Rus’ most Jews in these fields tended to work in small factories and workshops, processing agricultural and wood products.

Supply and Distribution

Trade was the most important branch of Jewish economic life in Eastern Europe. Not only did it provide a source of income for a large proportion of the Jewish population, but it also formed a crucial niche for Jews in the economies of the countries in which they lived. Though they were rarely the only group engaged in commerce, their success in filling the needs of their clients (who belonged to all social classes) often gave them an edge over their competitors. Their economic importance in these roles frequently won them the support of the authorities in the countries where they lived—whether the central authority of the king or the more localized authority of the nobility. This also stood them in great stead in their competition with the urban classes interested in driving them out of the markets.

As the number of Jewish colonies and settlements in Eastern Europe developed in the larger towns, such as Kraków, Kiev, and Prague, Jews began to act as suppliers of goods from outside the country, using their international connections to engage in long-distance trade. They were limited to the roles of wholesale suppliers by their legal status in the Polish towns, which prevented them from acting as retailers. Nonetheless, their economic activity (in moneylending as well as trade) attracted the attention of several Polish monarchs, who granted Jews various privileges encouraging their settlement in Poland in the thirteenth, fourteenth, and fifteenth centuries.

It was not until the sixteenth century, however, that Jews began to play a crucial role in the field of supply and distribution. Though they were still largely excluded from the retail market, their growing numbers and economic flexibility led more of them to take advantage of Poland’s network of regional, national, and international fairs and thus play a prominent role in the wholesale supply of goods to urban markets. In terms of retail distribution, economic necessity forced them to work in difficult conditions outside the urban monopolies; doing so, however, attracted them clients, particularly from among the nobility, who wanted to evade price-fixing disadvantageous to them. This situation irked non-Jewish burghers, who continued trying to limit Jewish mercantile activity; they seem to have encouraged the spate of anti-Jewish publications that appeared at the turn of the seventeenth century. The circumstances did not succeed, however, in seriously curbing the Jews’ activity in this field.

A particularly important role played by Jews in the Polish–Lithuanian economy in this period was in the distribution of agricultural produce, largely through the sale of grain on the local market in the form of alcohol. This they did in their roles as arendarzy, particularly those leasing taverns. Tavernkeepers (almost always Jewish) also formed an important link between the urban and rural markets: they would buy the peasants’ surplus grain for use in alcohol manufacture or for sale on the regional market, and, in their role as local shopkeepers, sell them goods from the towns. This role was particularly prominent in the eastern regions of the Polish–Lithuanian Commonwealth and also developed in Hungary during the eighteenth century.

Jewish man on market day, Kolbuszowa, Poland, 1929. (YIVO)

Following the wars of the mid-seventeenth century, Jews played an important role in reconstructing local markets in the eastern sections of the commonwealth, where they were often invited to settle on very advantageous terms by noble estate owners. In these conditions, they not only broke into the urban retail market, but also came to dominate it, often making up all the merchants in the small noble-owned market towns. Jews dealt largely in foodstuffs (including salt), beverages, furs, skins, and cloth. This dominance of the local markets did not mean that Jews were the wealthiest merchants—these came largely from other national groups such as Germans, Italians, and Armenians. Rather, Jews filled the lower ranks of wholesalers, shopkeepers, and peddlers. As the Jewish population grew rapidly in the towns, a stratum of poor Jews developed, who made a meager income by brokering small transactions between clients and merchants. While burgher hostility did not disappear entirely, the importance of the Jews’ activity in the marketplace as well as the support they received from the nobility tended, on a day-to-day basis, to undermine it.

This situation changed from the end of the eighteenth century. A number of factors caused this: urbanization and the modernization of markets left both Jewish merchants and their non-Jewish competitors in a new situation. Also important in this process was the development of the railroads, which tended to change the structure of regional trade, long the mainstay of Jewish mercantile activity. The markets in small rural towns, though still dominated by Jewish merchants, went into a gradual but far-reaching decline over the nineteenth century.

The development of the great cities of Eastern Europe was a mixed blessing for Jewish merchants: on the one hand, the rise of the urban masses and populist politics strengthened the role of Jews’ traditional competitors; on the other hand, a new mass market was created that opened up new possibilities for Jewish retailers. While most remained small shopkeepers, stallholders, and peddlers, others developed new strategies aimed at attracting more customers—department stores and shopping arcades owned and run by Jews (among others) began to appear in the urban environment of cities such as Prague, Warsaw, and Budapest toward the end of the nineteenth century.

During these years, state authorities often pursued policies aimed at productivizing Jews and weakening their commercial activities. Since little or no provision was made for improving alternative systems of supply and distribution in the places where Jews lived in great concentrations, these were largely ineffective. One result was that Jews were gradually forced out of the sale of alcohol in the taverns. This did not prevent them from continuing to be active in the sale of grain, most prominently in the new international market of Odessa. A spinoff of their dominance of this sector was the move of some of the wealthier Jewish merchants, such as Manfréd Weiss in Hungary as well as Wolf Natanson in Poland and Izrail’ Brodskii in Russia, into industrial production, based, initially at least, on the processing of agricultural produce.

The success of the upper stratum of Jewish merchants in taking advantage of the new economic opportunities of the nineteenth century, often remarked upon by contemporaries, was not shared by the vast majority of Jews engaged in trade. Suffering under government restrictions, particularly in the Pale of Settlement, they lacked the means to break out of outmoded, traditional patterns. By the outbreak of World War I, the typical Jewish merchant in the small rural towns, as well as the great urban centers, was extremely poor, eking out a meager living.

The events of World War I and subsequent political changes led to far-reaching changes in East European markets. Physical destruction and demographic shifts disrupted previous patterns of trade—a phenomenon intensified by the political and economic changes that began with the Russian Revolution of 1917 and the establishment of new nation-states after 1918. Jewish mercantile activity came under serious attack across the region. The Soviet Union viewed private commerce as negative in general, and sought to bring all trade under the aegis of state enterprises. Huge numbers of Jews, who had previously made their living from trade, were forced to change their occupation or face starvation. In Poland, Hungary, and Romania, the state increasingly intervened in the economic sphere and adopted policies aimed at ethnicizing their national economies, and so aimed to exclude Jews as far as possible from the marketplace.

This discrimination could take many forms: some laws were passed with the goal of harming Jewish merchants, such as Poland’s Sunday Rest Law, which effectively forced Jewish businesses to close two days a week. More common were bureaucratic restrictions of various kinds that made terms of trade more difficult for Jews than for their non-Jewish neighbors. However, though Jews’ position in the national markets was weakened, they still remained a leading force in the mercantile life of the states in which they lived through the late 1930s. In larger cities such as Warsaw and Budapest, masses of small Jewish merchants played a significant role in the urban economy, while in smaller towns they continued to link the rural and the urban economies.

For most of the interwar period, Czechoslovakia formed an island of Jewish success in trade. There was little discriminatory legislation, allowing Jewish tradesmen and merchants to retain a stronger position in the markets. In addition (or perhaps, as a result), the Depression of the 1930s did not hit Czech Jewish merchants as hard as those in other countries. In most of the East European nation-states, the Depression had very serious effects on Jewish economic life, though some scholars have argued that Jews suffered no more than their non-Jewish neighbors. Nonetheless, since Jewish merchants had to deal not only with the consequences of the Depression but also with discriminatory policies, their situation was particularly difficult. It deteriorated still further with the rise of extremist, chauvinist regimes in most states in the second half of the 1930s. They aimed to remove Jews entirely from their national economies, often using brutal legislative means to do so. By the outbreak of World War II, the decline in Jewish trade had brought pauperization to new, and extremely worrying, depths.

Other Occupations

While sectors of finance, trade, and production accounted for the overwhelming majority of Jewish livelihoods, there were always relatively small numbers of Jews who made their livings in other ways. Of these, perhaps the most important—and certainly the longest lasting—was work for the Jewish community. As early as the medieval period, there is evidence that Jewish communities in Eastern Europe employed teachers and/or cantors, though few had rabbis. As the communities grew and expanded in the late medieval and early modern periods (fifteenth–eighteenth centuries), the number of people they employed grew, too. Though the vast majority of office-holders, including the executive kahal council, were made up of elected figures who earned no salary from their communal positions, the communities, and particularly the larger ones, employed a range of officials. These could include cantors, preachers, teachers in a communal school (“TalmudTorah”) for poor children, doctors, and midwives. Slaughterers, though licensed by the communities, did not receive a communal salary.

A prominent salaried figure in the premodern community was the shtadlan (Pol., syndyk), who represented the community’s interests before the non-Jewish authorities. Some communities also maintained a salaried doctor. However, by far the most important figure employed by the community was the rabbi, who not only drew a salary, but also often received free housing, heating allowance, and tax exemptions, as well as payments from community members in return for the services he provided. The 1764/65 census of Polish–Lithuanian Jewry registered about 7 percent of the population as making their living from communal work.

During the nineteenth and twentieth centuries, many of the posts previously held as honorary and without pay became paid communal jobs. These included religious judges, slaughterers, and even circumcisers. Welfare and health institutions of the community also created a new body of employees. Thus, the numbers directly employed by the communities began to grow, though due to the Jews’ rapid demographic expansion, their proportion within the working population decreased. Since the holding of civil service posts was largely closed to Jews for most of the period, communal work of this sort was an important outlet for members of the growing bourgeoisie with education and managerial skills. Following World War I, the failure of most new nation-states in Eastern Europe to give sound financial support to Jewish communities as laid down in the Minorities Treaties meant that the communities’ ability to grow and absorb more staff was limited. This was the case even in Lithuania, where Jewish communities enjoyed state support until the mid-1920s. In proportional terms, communal work provided a living for less than 1.5 percent of Polish Jewry in 1931.

A related profession was teaching, widely viewed as one of the fundamental duties of Jewish society and culture. Throughout the medieval and early modern periods, all Jewish communities included a number of teachers and their assistants (belfers) for boys less than 13 years of age, who were sometimes even paid out of communal funds. More common was the private teacher (melamed), who ran a small school of his own. Though there was no formal syllabus or supervision, the local rabbi would often take it upon himself to ensure that the melamed’s pupils were receiving a suitable education in the holy texts. Jews who ran taverns in the villages and non-Jewish areas would often hire teachers to live with them and educate their children. After age 13, those boys who had the financial means and intellectual capability—a very small number—would be sent to a yeshiva, most often run by a rabbi without professional teaching staff. According to the 1764/65 census of Polish–Lithuanian Jewry, no less than 6 percent of the urban population made a living by teaching.

Since it required no professional qualifications, work as a melamed often attracted people unable to make a living any other way; the status of the job thus declined greatly in the nineteenth century. With the development of the Haskalah in this period, greater emphasis was placed on education as a means for encouraging modernization. However, though “modern” Jewish schools were opened, first in the Bohemian lands, Hungary, and Galicia, and later in Lithuania and Central Poland, they never proved popular enough to provide employment for more than a handful of progressive Jewish teachers. The emancipation of Austro-Hungarian Jewry did not pave the way for a great influx of Jewish teachers into the public schools. On the other hand, the importance that Jewish society placed on education was reflected in the fact that though they taught mostly only in Jewish schools, Jews were represented among the total teaching body at levels well above their proportion in the general population: 40 percent in the Pale of Settlement in 1897 and 25 percent in Galicia in 1910. This situation did not change drastically in the interwar period, though the advent of state education and teacher training, from which Jewish teachers were largely excluded (they were educated and worked mostly in the private Jewish sector), led to a decline of their representation in the overall number of teachers.

A Jewish couple at the entrance to their store, Świsłocz, Poland (now Svislach, Bel.), 1929. (YIVO)

Another of the most venerable professions undertaken by East European Jews throughout their history was medicine. As one of the highly educated groups in medieval and early modern society, Jews formed a significant proportion of the doctors in Eastern Europe, most prominently serving the royal courts. Since the University of Padua opened its doors to Jewish medical students from the fourteenth century, while certain German universities accepted Jews in the eighteenth, leading Jewish doctors in the Polish–Lithuanian Commonwealth often held university degrees. In addition, many Jews worked as paramedics (Yid., feldshers) particularly in the smaller, rural towns, where they frequently provided the only medical care available. In the 1764/65 census, some 2 percent of the Jewish population made their living from medicine at one level or another.

This situation did not change significantly until the last third of the nineteenth century, when more Jews chose to enter the medical profession as access to university education became easier. By 1910, Jews comprised nearly half of all doctors in Hungary and almost a third in Galicia. In the much less liberal setting of the Pale of Settlement, Jews still made up some 20 percent of all those making a living from medicine in 1897.

Conditions in the Soviet Union in the 1920s and 1930s were much more favorable for Jews who wished to pursue a professional education. Many Jews chose medicine, so that by the eve of the Holocaust, there were more than 20,000 Jewish doctors in the country—some 16 percent of all the doctors. The situation in the nation-states of the interwar period was quite different. Aside from Hungary, where a numerus clausus law had been instituted already in 1920, the possibilities for higher education open to Jews during that decade meant that many chose to study medicine. As the possibilities of finding work in state institutions and hospitals were very limited, the overwhelming majority entered private practice. In Poland in the early 1930s, for example, Jewish doctors made up about 20 percent of all doctors in the country, but well over half of all the doctors in private practice. As discriminatory policies grew harsher throughout the region during the 1930s, possibilities for Jewish students to study medicine and receive licenses to practice became increasingly restricted.

A similar pattern may be observed in other professional careers, particularly in the fields of law and engineering. Jews were attracted to these fields, due to the possibility of receiving academic certification and then working privately, since public service was largely closed to them. This phenomenon seems to have started in the Austro-Hungarian Empire following the emancipation of Jews in 1867. By 1910, some 40 percent of Hungary’s engineers and nearly 60 percent of the lawyers in Galicia were Jewish. Jewish prominence continued into the interwar period, though increasing discrimination made working in these fields more and more difficult. By the late 1930s, because of restrictions on access to higher education, only 16 percent of Hungary’s engineers were Jewish. Since conditions in the Soviet Union, including mass urbanization of Jews, favored Jewish professional education throughout the interwar period, there were 25,000 Jewish engineers in the Soviet Union by the late 1930s—some 10 percent of the total. In addition, the Soviet Union was one of the few countries in interwar Eastern Europe where Jews could find work in the universities, making up about 9 percent of the total university staff there.

Another significant change in Jewish occupational patterns during the nineteenth century was the development of Jewish white-collar workers. With the growth of a Jewish middle class, whose children enjoyed a modern education, over the course of the century there was a move away from working directly in trade and crafts, to managerial and bookkeeping positions in various companies and factories. Since this phenomenon paralleled the development of the Jewish bourgeoisie, it never reached great proportions, except perhaps in Hungary and Bohemia. Conditions in the interwar period in the nation-states of Eastern Europe did not favor the further growth of this group, while paradoxically it was the Soviet Union that provided its educated Jewish population with better possibilities of managerial employment.

The Holocaust and After

Although there are ample reasons for viewing the period of the Holocaust as a total break from what came before, in economic terms it is possible to perceive certain continuities. The policy of excluding Jews from the national economy that had gathered strength in the nation-states during the interwar period was now implemented in extreme fashion with the physical segregation of Jews into ghettos. Nonetheless, initially at least, Nazi policy was divided among those who favored exploiting Jews as slave labor in German industries and those who favored their immediate extermination. Before and during the implementation of the Final Solution, many thousands of Jews worked as slave laborers. Some of the Jewish leadership—particularly in the Łódź ghetto—believed that by supplying the Germans with Jewish labor and products, they could ensure the survival of their community. Though the Łódź ghetto survived longer than most, this policy ultimately proved ineffective.

A bagel seller with his wares, Biržai, Lithuania, 1938. (YIVO)

In ghetto conditions, the possibility of survival (though minimal) could have an economic component. For example, craftsmen with a skill to sell could, initially at least, survive more easily than others. In addition, workers who served individual Germans could sometimes ensure their survival through their patron’s protection. Community administration within the ghetto grew rapidly, providing some kind of employment for thousands of Jews. Since these jobs sometimes provided not only a salary but also access to food in the form of soup kitchens and other institutions as well as the possibility of attaining various permits, the Jewish population generally seized upon them.

Private enterprise did not entirely cease inside the ghetto walls, particularly in the field of trade. By far the most important commodity was food. In starvation conditions, individuals desperately sought any means to acquire food for themselves and their families. In addition, a whole range of large-scale smugglers and black marketeers began to develop. Smuggling, whether for personal or commercial reasons, was extremely dangerous. Anyone caught was likely to be shot on the spot—even the Jewish women and children active in smuggling the food itself into the ghetto. Ghetto society was divided in its opinion of the large-scale smugglers; some viewed them as criminals, while others viewed them as entrepreneurs, helping to supply food when the official leadership could not.

In the end, of course, it was noneconomic considerations that sealed the fate of East European Jewry at the hands of the Nazis.

As the Red Army conquered Eastern Europe from the Nazis during 1944, the few remnants of Jewish society that had survived began to come together to start trying to reorganize their lives. Some tried to return to their prewar activities in the realm of trade. Others, such as crafts workers from among the small Polish Jewish community of Holocaust survivors, unionized themselves into cooperatives in order to better deal with the new economic realities of liberation. The cooperatives that Jews had established were occupied, among other things, in tailoring, shoemaking, weaving, baking, and building. In addition, a few agricultural collectives were established. Also noteworthy was the renewal of activity by the Zionist training farms, preparing Jews for emigration.

When the Soviet Union began to consolidate its hold over the region in the late 1940s, the policy of productivization was once again imposed on Jews, who soon ceased independent mercantile activities. The specifically Jewish cooperatives were also not viewed favorably and, with the tightening of Communist control, soon declined and eventually disappeared. Jewish agricultural work did not develop either, which meant that the most important center of East European Jewish farmers in the second half of the twentieth century was the State of Israel.

Unemployed people, craftsmen and artisans can get machines through ORT, with the financial support of their relatives abroad." Russian poster. Artwork by Mikhail Dlugatch. Printed in Moscow, 1930. (Gift of Mr. and Mrs. Ludwig Jesselson, 1998.625. Collection of Yeshiva University Museum, New York)

In postwar Eastern Europe, the greatest concentration of Jews was to be found in the Soviet Union. The loss of a huge proportion of Jews on its western borderlands seems to have changed the occupational structure of Soviet Jewry. With the disappearance of much of the poorest strata of society, it took on a more highly educated—and even intellectual—profile. Despite discrimination, Jews were represented in educational institutions at levels above their proportion in society. In occupational terms, Jews became prominent in fields of medicine, engineering and technology, journalism, as well as some aspects of the academic and even the musical world. However, the spread and intensification of antisemitism in the Soviet regime and in society tended to hamper Jews progressing far within their chosen fields, which led to frustration and anger, sometimes channeled into the dissident movement.

The collapse of the Soviet Union at the end of the twentieth century and the development of capitalism on its former territories—though it saw the rise of a small Jewish plutocracy—does not yet seem to have significantly altered the economic structure of Jewish society there. However, fears of antisemitism led to a mass emigration of Russian Jews to Israel, Germany, and the United States, particularly during the 1990s. In the highly developed Western economies, many immigrants found their educational and technical skills outdated and were forced into less qualified jobs and even unskilled labor, a trend the next generation seems destined to reverse.